Financial Fresh Starts

Traditionally, New Year is the time for resolutions, new dreams, new plans – or at the very least, sweeping away a pile of stuff you’d rather forget about. Given that Christmas is invariably a pretty expensive time, with presents, nights out and the often-insane Food Fest to which we all seem to subscribe, it really is a natural time to take a look at your financial position and perform a few perfunctory health checks.

2011 dawns trickier than many early years of the previous decade from an economic point of view, as we are all only too sharply aware. Since the market meltdown in 2008, we have seen widespread job losses, restricted growth and endemic ‘austerity’ – a simple word which now joins the ranks of those other innocent words that increasingly feel like irritating cliches, such as ‘unprecedented’, ‘current climate’ – and most recently ‘Arctic‘!

Markets have been largely buoyant over recent months and the trading outlook is favourable for smaller companies who have survived, stripped out costs and are benefiting from low interest rates. Economic headwinds may be slowing the progress of some of the UK’s biggest companies, but we can look to the very best of our smaller companies to help turn the tide and build growth. Strong management teams and wise cost management strategies mean that many of these smaller niche players are well positioned to perform well, despite the continuing economic challenges. Spending by UK consumers is likely to be hit by looming public sector cuts, but we are all looking hopefully (and delicately? tensely, even?) to the private sector to create new jobs to replace those lost and to stimulate growth.

It’s also a time where many of us would like to use the crisis of the last 2 years as a learning platform, from which to launch new ways of working : ethical, sustainable, trusting. If that sounds like an Elysian dream to you, then you’re probably not in the group that wants to change in that direction. Which is fine – the hope for 2011 must surely be that we allow and enable a multitude of working structures and styles, rather than falling directly back into the many unpleasant attributes and traditional ‘leadership’ afflictions that contributed so powerfully to the financial collapse we have just experienced.

And who do you trust with your own money? Confidence in the banks has been shaken to the core. Investor risk appetite has been affected by the wide economic uncertainty and for the average investor, understanding the risk profile of an average fund has become extremely difficult. Diversification is important (as anyone burned by their mass holding of ‘blue chip‘ Bank or BP stocks will tell you) , as is an appreciation of volatility and the expertise and ability to change things when appropriate – which is where a good independent financial adviser really comes into their own.

It has to be independent, in our view right now; being tied to specific providers at such a time cannot possibly give you access to the broadest of options that could be right for you. One of the toughest things at a time like this is to keep saving, keep building a pension, but it is crucially important to take cognisance of your future position. The Independent Women ‘Shoe Fund‘ (http://www.independentwomen.co.uk/iw/our-services/the-shoe-fund.html) for example, is a fun metaphor we use for isolating the need to spend from the need to save and finding the most palatable and effective way of doing both generally requires a bit of expert help.

Investing in a trusted adviser could be one of the most useful things you do this year ; not only can an adviser provide a valuable service in terms of getting all your financial ducks in a row, but it can free up space in your head where you no longer have to stress about those laborious financial issues that keep slipping to the bottom of your list.

Most women are not incapable of making financial decisions, but a lot of us wouldn’t choose it as a preferred way to spend some time….in any case, let’s all look forward positively to 2011 as a year which will bring the best life has to offer, at as many points as we can find it.

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